Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - New Concept Energy, Inc. | d72030e8vk.htm |
Exhibit 99.1
| For Immediate Release | Contact: Gene Bertcher | |
| (972) 407-8400 |
New Concept Energy Reports Fourth Quarter and Full Year 2009 Financial Results
Dallas,
Texas (Business Wire) March 31, 2010: New Concept Energy, Inc. (AMEX: GBR), (“the
Company” or “NCE”), a Dallas-based oil and gas company, today reported a net loss for the twelve
months ended December 31, 2009 of $2.2 million or $1.27 per share, compared to net income of $15.5
million or $8.92 per share for the twelve months ended December 31, 2008. Net loss for the three
months ended December 31, 2009 was $2.2 million as compared to a net loss of $150,000 for the three
months ended December 31, 2008.
The loss in 2009 is primarily attributable to a non-cash charge to operations of $1.7 million
related to impairment of the Company’s oil and gas reserves. In addition, the spot price for
natural gas in the markets where the Company operates was substantially lower in 2009 than in 2008.
The net income in 2008 was primarily attributable to a one-time sale of mineral rights in the
Fayetteville Shale resulting in a gain of $16.4 million.
Revenues and Operating Expenses: Total revenues for 2009 totaled $4.1 million compared to $3.6
million in 2008. The primary reason for the increase is the acquisition of the oil and gas
operations in September 2008. Fiscal 2009 reflects a full twelve months of operating revenue for
the oil and gas operations, while 2008 reflects only four months of such revenue.
Revenue for the retirement facility totaled approximately $2.9 million for 2008 and 2009.
Operating expenses totaled $6.8 million for 2009 compared to $3.7 million for 2008. In 2009, oil
and gas operating costs totaled $1.5 million compared to $496,000 in 2008 due to the acquisition of
the oil and gas operations described above. In 2009, the company recorded a non-cash charge to
operations of $1.7 million for impairment of natural gas and oil properties, pursuant to the
results of the full-cost ceiling test. Also in 2009, the Company recorded accretion of discount
related to its asset retirement obligation of $117,000. Operating expenses for the retirement
facility remained relatively constant.
Corporate general and administrative expenses increased from $852,000 to $1.2 million, due
primarily to the write-down of receivables of approximately $200,000 and the accrual of taxes of
$200,000, offset by reductions in salaries and wages of approximately $50,000.
Interest Income: Interest income decreased approximately $200,000 from 2008 to 2009 due to the
reduction interest rate on portions of the notes receivable from eight percent to the prime rate
plus two percent during 2009.
Interest Expense: Interest expense for 2009 decreased approximately $150,000 due to the pay-off of
$6.9 million of related party debt in the first quarter of 2008.
Gain on sale of assets: In 2008, the Company sold its investment in mineral rights in the
Fayetteville Shale for a gain of approximately $16.4 million. No gain or loss was recorded on sales
of assets in 2009.
Other Income: Other income decreased from $464,000 in 2008 to 68,000 in 2009. Other income in 2008
is primarily due to cash received from receivables that were previously fully reserved.
New Concept Energy, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF OPERATIONS
(amounts in thousands, except per share amounts)
(amounts in thousands, except per share amounts)
| Year Ended | ||||||||
| December 31, | ||||||||
| 2009 | 2008 | |||||||
Revenue |
||||||||
Oil and gas operations, net of royalties |
$ | 1,241 | $ | 672 | ||||
Real estate operations |
2,857 | 2,888 | ||||||
| 4,098 | 3,560 | |||||||
Operating expenses |
||||||||
Oil and gas operations |
1,516 | 496 | ||||||
Real estate operations |
1,334 | 1,400 | ||||||
Lease expense |
958 | 954 | ||||||
Corporate general and administrative |
1,207 | 852 | ||||||
Accretion of asset retirement obligation |
117 | — | ||||||
Impairment of natural gas and oil properties |
1,695 | — | ||||||
| 6,827 | 3,702 | |||||||
Operating earnings (loss) |
(2,729 | ) | (142 | ) | ||||
Other income (expense) |
||||||||
Interest income |
574 | 785 | ||||||
Interest expense |
(123 | ) | (270 | ) | ||||
Gain on sale of assets, net |
— | 16,432 | ||||||
Other income, net |
68 | 464 | ||||||
| 519 | 17,411 | |||||||
Earnings from continuing operations |
(2,210 | ) | 17,269 | |||||
Provision for income taxes |
— | (1,774 | ) | |||||
Net income from continuing operations |
(2,210 | ) | 15,495 | |||||
Discontinued operations (net of income taxes) |
||||||||
Loss from operations |
— | — | ||||||
Gain (loss) from sale of assets |
— | — | ||||||
Net loss from discontinued operations |
— | — | ||||||
Net income applicable to common shares |
$ | (2,210 | ) | $ | 15,495 | |||
Earnings (loss) per common share — basic |
||||||||
Continuing operations |
$ | (1.27 | ) | $ | 8.92 | |||
Discontinued operations |
— | — | ||||||
Net earnings (loss) per share |
$ | (1.27 | ) | $ | 8.92 | |||
Weighted average common and equivalent shares
outstanding — basic |
1,737 | 1,737 | ||||||
The accompanying notes are an integral part of these statements.
New Concept Energy Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS
(amounts in thousands)
CONSOLIDATED BALANCE SHEETS
(amounts in thousands)
| December 31, | ||||||||
| 2009 | 2008 | |||||||
Assets |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | 155 | $ | 190 | ||||
Accounts receivable from oil and gas sales |
203 | 353 | ||||||
Note and interest receivable — related party |
11,206 | 10,731 | ||||||
Other current assets (including $189 from related parties in 2008) |
567 | 428 | ||||||
Total current assets |
12,131 | 11,702 | ||||||
Oil and natural gas properties (full cost accounting method): |
||||||||
Proved developed and undeveloped oil and gas properties, net of
depletion |
11,372 | 13,022 | ||||||
Property and equipment, net of depreciation: |
||||||||
Land, buildings and equipment — oil and gas operations |
1,337 | 1,291 | ||||||
Other |
149 | 149 | ||||||
Total property and equipment |
1,486 | 1,440 | ||||||
Other assets |
132 | 228 | ||||||
Total Assets |
$ | 25,121 | $ | 26,392 | ||||
The accompanying notes are an integral part of these statements.
New
Concept Energy Inc. and
Subsidiaries
CONSOLIDATED BALANCE SHEETS — CONTINUED
(amounts in thousands, except share amounts)
CONSOLIDATED BALANCE SHEETS — CONTINUED
(amounts in thousands, except share amounts)
| December 31, | ||||||||
| 2009 | 2008 | |||||||
Liabilities And Stockholders’ Equity |
||||||||
Current liabilities: |
||||||||
Accounts payable — trade |
$ | 154 | $ | 202 | ||||
Accrued expenses |
2,711 | 1,944 | ||||||
Total current liabilities |
2,865 | 2,146 | ||||||
Long-term debt: |
||||||||
Notes payable |
1,198 | 1,026 | ||||||
Asset retirement obligation |
2,450 | 2,334 | ||||||
Other long-term liabilities |
326 | 394 | ||||||
Total liabilities |
6,839 | 5,900 | ||||||
Stockholders’ equity: |
||||||||
Preferred stock, Series B |
1 | 1 | ||||||
Common stock, $.01 par value; authorized, 100,000,000
shares; issued and outstanding, 1,946,939 shares at
December 31, 2009 and 2008 |
20 | 20 | ||||||
Additional paid-in capital |
58,838 | 58,838 | ||||||
Accumulated deficit |
(40,577 | ) | (38,367 | ) | ||||
| 18,282 | 20,492 | |||||||
Total Liabilities & Equity |
$ | 25,121 | $ | 26,392 | ||||